The Pomp Podcast - #749 This Bitcoin Conversation Blew My Mind w/ Jason Lowery

Episode Date: December 10, 2021

Jason Lowery is a member of the U.S. Space Force In this conversation we discuss Bitcoin, The Network, Kinetic vs. Electric Power Production, and Jason gives us some new frameworks of Bitcoin. This is one of the most powerful conversations I've ever had on Bitcoin, I hope you enjoy and share it with your friends and family. ======================= BlockFi provides financial products for crypto investors. Products include high-yield interest accounts, USD loans, and no fee trading. To start earning today visit: http://www.blockfi.com/Pomp ======================= Choice is a new self-directed IRA product that I'm really excited about. If you are listening to this, you are likely part of the 7.1 million bitcoin owners who have retirement accounts with dollars in them, but not bitcoin. I was in that situation too. Now you can actually buy real Bitcoin in your retirement account. I'm talking about owning your private keys and using tax-advantaged dollars to do it too. Absolute game changer. https://www.retirewithchoice.com/pomp ======================= Circle is a global financial technology firm that enables businesses of all sizes to harness the power of stablecoins and public blockchains for payments, commerce and financial applications worldwide. Circle is also a principal developer of USD Coin (USDC), the fastest growing, fully reserved and regulated dollar stablecoin in the world. The free Circle Account and suite of platform API services bridge the gap between traditional payments and crypto for trading, DeFi, and NFT marketplaces. Create seamless, user-friendly, mainstream customer experiences with crypto-native infrastructure under the hood with Circle. Learn more at circle.com.

What's up, everyone? This is Anthony Pompliano. Most of you know me as Pomp. You're listening to the Pomp Podcast, simply the best podcast out there. Now let's kick this thing off. Jason Lowry is an active member of the US Space Force. In this conversation, we discuss Bitcoin, the network, the idea of kinetic versus electric power production. And on top of this, he gives us a couple of new frameworks to think about Bitcoin. This is one of the most powerful conversations I've ever had about Bitcoin, and I highly suggest you listen to this, pay attention, take notes, and then share it with your friends. Before we get into this episode, I want to quickly talk about our sponsors. First up is BlockFi. BlockFi provides financial

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to book a meeting with one of their experts. Again, circle.com slash pomp and book a meeting with one of their experts. Big fan of Circle, and I think you will be as well. All right, let's get in this episode. I hope you guys enjoyed this one. Anthony Pompliano runs Pomp Investments. All views of him and the guests on his podcast are solely their opinions and do not reflect the opinions of Pomp Investments. You should

not treat any opinion expressed by Pomp or his guests as a specific inducement to make a particular investment or follow a particular strategy, but only as an expression of his personal opinion. This podcast is for informational purposes only. Let's start first because you got the uniform on. Space Force. What the hell is Space Force? Like the first time I heard this, I was like, oh, that's that's a hilarious Internet meme. Like, no. And then literally we have Space Force. Like, what is Space Force? Yeah. Space Force is a new military branch dedicated to organizing, training and equipping military forces in support of and presented to the new designated geographic combatant command called Space or U.S. Space Com. So I think it does the same thing that you would expect the Army to do for different combatant commands, but for space.

And so we've legally defined everything above, I think it's like 100,000 kilometers or something. There's some threshold where that is formally now a combatant command. Okay. So when I think of space force and this idea of we need to like patrol and protect the space, right. Uh, from a, uh, a military standpoint, are we worried about other countries? Are we worried about aliens? Are we not worried about anything, but we just feel like, Hey, maybe we should go stake our, you know, like a, kind of like a dog when it goes outside, like it is my area. Like, how do we think about this? so right now the main concern is other countries okay not aliens okay disappointing but okay and and is this more of like um uh satellite like uh almost um i would think of it as like control right so like hey there's there's space around earth and if people are able to position satellites or other types of technology in certain areas that could be a national security threat or something else is that like a general uh idea of what what you focus on or or at least space

force focuses on that's one part of it okay so something that was cool about when we set up space force is we formally declared a new delta whose role is to protect and defend on orbit from orbit which is sounds awesome yeah that's not the only that's not the only thing that space force does a lot of our weapon systems that we use on the ground terrestrially depend heavily on space-based capabilities so like i imagine when you were downrange you probably used gps a lot you probably used satellite communications a lot i know that if there's ever like a mortar attack well not a mortar attack but like a rocket attack on people who are downrange we've got assets in space who can see that and they tip and cue and they warn the

people at the forward operating bases to take cover, give them eight more minutes than they would have had otherwise. So the majority of our space systems are dedicated to the support of terrestrial combat. But the issue is now we're getting into a situation, and you can read about it and listen to our higher ranking generals than me, where the China-Russia fans out there have learned that a good way to disrupt terrestrial combat is to point the gun at the satellite in space. And so that starts to beg the question, okay, well, now we have to figure out how to create satellite systems that are more defendable that, um, and then if necessary to punch back. Okay. So last question I have around space force, and we'll get to, uh, things that you probably,

you want to spend more time talking about, uh, but just out of personal curiosity, if i think of humvees on the battlefield you know years and years ago uh most of them had no weapon system on it and then over time we realized like hey one there are targets they need to be able to defend themselves and two actually they have some mobility to it they have certain aspects uh that they can provide better weapon systems and and uh kind of be an offensive tool as well maybe we should put some weapon systems on top of these humvees are we gonna see satellites with like missiles attached to it or uh some sort of like anti-missile satellite technology like is that where this ends up even it's 50 years away well so i mean i don't

know what the future will be but space presents a whole bunch of different challenges the main problem with kinetic power projection in space is something called kessler syndrome where if you create a bunch of shrapnel or debris using like a missile then you could cause way more damage permanently than you would ever want to. So we just had Russia shoot down a satellite and immediately we had astronauts taking cover in the ISS because there's a whole bunch more debris orbiting the earth now. So there's a lot of different ways that you can project power and defend or do offense in space. Kinetic is one of them, but I hope that would never be used in space. okay hold on you're gonna have to run me back here for a second russia shot down a satellite

and the astronauts the iss had to take cover yeah happened like a couple weeks ago you're saying that like i like that's like a uh a thing that's gonna happen regularly now like should we be worried about that i mean china's done it right the united states did it a while ago but we were we made sure that the the fragmentation would come back down to earth not would stay in orbit right So this brings up a whole bunch of new questions on what is responsible behavior in space. And so a good way to think about like a war that extends into space is that would be a war without winners. That is very similar to a nuclear war. Right. So really the job of Space Force right now is to do whatever we can to deter the fight from ever going into orbit because of how devastating that would be to civilization as a whole.

And so to that end, there's a whole bunch of other ways that you can project power without causing Kessler syndrome, right? You can use jamming methods, you can use directed energy weapons, you know, you can cause non-permanent damage, but still have a similar effect, if that makes sense. Yeah. Uh, it's incredible to think about, um, where we are now and how sophisticated it could get, uh, given it seems pretty primitive at the moment, but like, that's some scary shit. Uh, one more thing, Pomp, before we move on, I just thought of another one. So what's cool about creating a combatant command for space is that now you have a combatant commander who can tell our friends at the army or the Navy or the air force, hey can you come help me out so another way that you could like project power or disable a harmful enemy satellite is just to have your army friends blow up the control for that right that's somewhere

on the ground right or have your air force friends drop a bomb on the control station so these are the things that you have to think about even though maybe the pointy end of the spear might be in space you can still cause yep the effect that you want terrestrially all right now i got another stupid question uh if you blow up the control center let's say you drop a bomb from the air force uh satellite just uh float away or like what happens to the satellite it's like uh i don't know where to go i don't have any controller like i just sit up there in orbit and spin around or what goes on yeah probably i i would imagine that's what would happen Yeah. All right. Space is wild. I invested in a company, uh, Varda, um, that, uh, is doing like

space factories. And as I was learning more and more about this whole idea, I was like, wait a minute, you tell me you want to go do things up in space. That's like cheaper, faster, you know, lighter, whatever, and then bring it back. And they're like, yes. And I was like, that sounds insane. I'm in, uh, so like, you know, space warfare is even crazier. Um, all right. Talk to me about, uh, Bitcoin and kind of your journey. I think a lot of people, uh, I was saying before you came on uh you're on linkedin you're you're freaking killing people on linkedin and then you came over to twitter i see you laughing so i know that you you're probably giggling to yourself while you're just firing off on people on linkedin uh when did you first come across bitcoin what

attracted you to it just kind of walk me through uh when you first discovered it i remember being this is so typical of what you would expect someone like me to say i remember being at a star wars trivia night in a bar talking to my friend and my friend had bought bitcoin and he was explaining it to me it was like 2013 2014 it was it was 300 i don't know when it was it was 300 at the time and i thought it was cool because like as a kid when i you know was playing video games i was a huge nerd there would be in-game currencies and i remember like trying to convince my parents, like they need to give me money so that I can go buy some in-game currency so that my character could be stronger. Right. And so when I first heard about it, I was like, oh,

that's pretty sweet. It's like an in-game currency, but for reality. But I didn't think that it would work because I thought, you know, the government would stop it like a lot of people still do today. And so, you know, my story, I think, will be similar to a lot of other people's story where we just have to live with the regret of thinking that way and discounting it. Over time, after learning and reading more, I eventually realized, okay, there's something to this and it's extremely resilient to attack. Maybe I should start to buy some. Yeah. And so talk to me today about how you see Bitcoin. One of the things that I think you've done a fantastic job talking about is the network itself and how to think about it essentially

defending uh the folks who hold bitcoin etc and given the fact that uh you know we could sit here and talk probably for hours about defending space or defending other types of uh attacks you've got a very interesting perspective so just maybe walk us through how you see the bitcoin network as like a defense mechanism yeah so i guess the this deserves some clarification up front when you say something is a weapon system or something is a defense system, some people like jump automatically to thinking you're describing a gun or something like that. But a lot of things are defense systems and or weapon systems that you wouldn't intuitively think about. So, for example, the Romans created stone roads between ports, right? That was created by the Roman Legion.

It was a defense system so that they could get to, you know, defend their ports easier terrestrially. Or for example, like this is a good example. Why do you think we have GPS? If I ask you that. Why? Right. Yeah.

Why do we have GPS? To understand where we are and where we're going. Right. So to have precision navigation, right. And also to have precision timing because every GPS satellite has an atomic clock in it. Correct. Okay.

So why do you think we actually built GPS? So everyone's on the same page in terms of time, right? So the reason why we built GPS is so we're getting a quiz. Damn F minus go ahead. When, when Sputnik was first launched, it was sending out a radio signal and we had Americans that were measuring that signal and they realized the scientists realized that you could do time distance of arrival off of a satellite, which is cool because then you could triangulate your

position relative to the satellite. And so for 20 something years, 25 years, the scientists kept on arguing it would be really beneficial to humanity if we created a giant constellation of signal emitting satellites that would allow anyone anywhere in the world to be able to triangulate their position relative to those satellites. It would be awesome for navigation. And by the way, the way to do it precisely is if we put super precise clocks into space, which would double benefit us because then everyone would have basically free access to precision timing as well. And so the scientists argued for decades that this would be valuable to humanity, but that's not why it was funded because it seemed too expensive at the time. People didn't

fully understand its value until we ran into an issue where we were in a cold war with the with the ussr and we had the capability to launch intercontinental ballistic missiles and they those intercontinental ballistic missiles knew where they were because they had inertial navigation systems in them that were accurate for something like 30 minutes ditto for if we scrambled bombers and we wanted to fly bombers and drop bombs. They would have inertial navigation systems inside of them that were accurate enough. But a problem came up where what if Russia shot first or what if the USSR shot first and they targeted our bombers and they targeted our ICBM silos? We would have to be able to mutually assure the destruction of Moscow if that happened,

We'd have to make it too expensive for them to make that decision. And so the way we do that is we have something called Trident missiles or submarine-launched ballistic missiles. We basically park nuclear missiles hidden under the water all around the world so that if anyone tried to shoot first, it would hurt them, right? We could guarantee that that would hurt them, even if we lost our ICBMs, even if we lost our bombers. So it's called the nuclear triad.

there's a problem though technical problem the technical problem is that submarine has been underwater for 30 days and the inertial navigation system on it is useless so if we did get shot first and then we decided to do a second strike to mutually assure the destruction of moscow and we launched that trident missile and it breaks the surface how is it going to know where it is It has no idea where it is. That missile has no idea. And so what we realized is, man, we need a giant constellation of satellites so that anything, anywhere in the world at any time could know where it is, particularly a Trident submarine-launched ballistic missile. And so that's eventually what caused us to fund GPS. And then once we funded GPS, and once we built this massive weapon system, right, that was intended explicitly to mutually assure the destruction of USSR, did we realize, wow, there's a lot of other stuff that you could do with GPS. This is great for civilization, just like the scientists kept on saying. And then in Desert Storm, the value of precision timing and navigation was very clear. And since then, especially once we turned off selective availability and allowed everyone to have precision navigation and timing, it's clear.

But people often forget that GPS is a weapons system. It exists to mutually assure the destruction of other countries, right? There's a lot of weapons systems like we have that we have that do the same thing, right? Nuclear hardened satellite communications, right? TCPIP, the internet, right? The internet exists so that we can survive, we can have C2 that survives a nuclear level strike. SHA, right?

As in SHA-256, right? As in designed by the NSA. These are systems that are explicitly intended for the defense of the United States. And so, you know, if we keep pulling that thread, eventually we get to all of the critical enabling technologies that go into Bitcoin. We get TCP IP, we get SHA, we get precision timing and synchronization of nodes through GPS. We get it written in C++, which was, you know, something that an American designed at Bell Laboratories. Every single piece of Bitcoin that fundamentally matters is effectively a piece of technology that was designed to improve military scale defense, particularly against the destruction of nukes. And so if you continue to pull that thread a little bit further and a little bit further, you can start to conceptualize Bitcoin as way more than just money.

Bitcoin is, and I know a lot of people on Twitter will be angry at me for saying this, Bitcoin is a weapon system, just like GPS is a weapon system. It is a weapon system designed explicitly for self-defense, and it is extremely effective, right? It is literally nuclear resistant, like every piece of it was designed explicitly to be resistant to nuclear strikes. So that's, you know, that's pretty interesting, right? There's probably some national strategic opportunities with Bitcoin that we could take advantage of, and that's kind of what I want to explore. Okay, so two things. One is recently Naval Ravikant had a tweet where he said that Bitcoin is the Second Amendment, which is very in line with what you're talking about here in terms of it is the defense mechanism, is your right to bear arms, right? Not necessarily for offensive purposes, but also for defensive purposes. and so when you start to think about this the network itself when you unpack the players or

the market participants if you will there's the miners and the node operators how do you think about uh the relationship between those two as part of this defense system for your purchasing power or your economic value and also how do you think about um kind of them in relationship to if there was some attack and doesn't necessarily have to be a nation-state attack could be a bad actor could be a whole bunch of different things. But unpack a little bit more about this idea of like the network is the defense system. Really, there ends up being kind of two core players, right? In terms of the node operation, the miners, how do they fit into this in your kind of framework? Yeah, so I think a useful way to think about it. So this is where the

exploration of Bitcoin becomes so fascinating, because to really fully understand what it does and what value it brings. You have to think very big. And so if you think about civilization itself, the role of governments, the role of militaries, the role of currency, Bitcoin has a little bit of everything, right? So, so, you know, you can, you can abstract governments as effectively a trade mediation as a service, right? This is like, it gets back to like the champagne fairs in medieval Europe. You would need a military, you need a military to preserve trade routes, right? That's why you have Navy. Okay. The Navy will make sure that we don't, you know, that our trade routes are uninterrupted. You need a rule of law, right, to preserve

the rules of the contracts, to build the contracts, to preserve the rules of the contracts. And then you need a monetary entity as well. Bitcoin is all three. It is a military, it is a rule of law, and it is money. The miners, the mining network is its military. the nodes right and the software is the rule of law and the legislation and all the voting and the least interesting part of it in my opinion is the money this the satoshi's right uh that's like the thing that comes last what what makes bitcoin so special is that it has its own military that is literally as powerful as nation state militaries and when when you think of that right so if you think of that exact idea where it is built in one of the

things that i wrote maybe two years ago at this point which i took a ton of flack for at the time was this idea that the money, historically, on its rise to, let's say, global reserve currency status or high adoptability, ends up almost always being catapulted to that position via violent conflict in which one party ends up being successful over another, and then they establish their money, right? So you're one nation, I'm another nation, you have the global reserve currency. I show up, I conquer you. Now my money is the global reserve currency. So there's a violent conflict that occurs. And what I wrote about was this idea that Bitcoin specifically would be the first currency, the first store of value to rise to global reserve status

without ever dropping a bomb, shooting a bullet, needing soldiers, guns, et cetera. And the idea was in the analog world, the person who has the best offense is the most powerful. So if you have the most firepower, if you're the most effective from an offensive standpoint, you are the most successful military in terms of going and conquering. But in the cyber, virtual, digital world, if you have the best defense, you're actually the most powerful because all you have to do is basically continue to defend 24-7, 365, without fail, no matter what the attack is. And therefore, people begin to slowly adopt and realize that this is the strongest thing. And so Bitcoin's computing network is the strongest computer network in the world, and therefore has the greatest defense. And if it has the greatest defense, it will continue to prove to be the strongest, the thing that people can put the most trust in. And over time, it just continues to kind of outlast everything else. And so my thought process was like, the world changes when we go from like an analog based world to a digital based world. And now it's not about offense, it's about defense, which actually seems to be somewhat in line with what you're talking about here of the money and the quote unquote army being one, right? They come together in a package. Yeah, so I can give you my thoughts.

And for the record, all of these thoughts are my thoughts. These do not represent the DoD's thoughts. Okay, so first of all, yeah, it is interesting the correlation between the entity with the dominant military tends to have the world reserve currency, right? If you read that. It's also interesting that if you read history, history is effectively a time-partitioned ledger written by those who projected the most kinetic power and won, right? History is written by the victors. History is written by those who won the power projection game, right, the competition, okay?

so that's interesting the the just the distinction between offense and defense is one that especially in the space force is not very useful we can um and i can kind of like we can i'll illustrate that if china were to put or let's say china russistan were to put a nuclear tipped hypersonic missile into a parking orbit around the moon, is that an offensive action or is that a defensive action? You're going to be more of an expert than me. I don't know. What is it? Right. So, okay. Let's ask another question. If the United States blows up that nuclear-tipped hypersonic warhead in orbit around the moon? Is that an offensive action or is that a defensive action? Hopefully you got the answers, man, because I don't. Yeah. The answer is physics

doesn't care, right? Like the answer is physics is blind to the distinction between offense and defense. And so, especially in the year 2021, where much of everything we do is interconnected, is cyber, is space, the distinction between what is an offensive action and a defensive action is gradually less meaningful. At the end of the day, the first principle's view of any military action is you're projecting power, right? You are transferring joules per second, right? And yes, you know, like whether or not you interpret that as an offense and defensive action is essentially what side of the trade are you on? China, Russia's fan is going to have a very different opinion if we blow up their nuclear warhead in lunar orbit

than America, right? So in my, like the way I look at it is I, I choose to look at things the way that physics looks at things and physics is blind to the distinction between offense and defense. That being said, it is useful to consider, okay, there may be different types of ways that you can project power, right? If you, if I, you know, punch you in the face, what am I doing? I am displacing the mass of your head over some distance, right? Which means I've created energy, right? I've created joules, right? And the transfer of joules over time is power. But that's not the only way to create joules. I could also put a charge across a resistor, right? And you've created electric energy and the transfer of electric energy is

still joules per second. There is fundamentally no distinction between kinetic power projection and electric power projection. It's just how that power is generated that's the difference. And so that gets really, really interesting when you start talking about how Bitcoin works and why it's so similar to the primary value delivered function of militaries. It's because this, all civilization, all living creatures obey the social consensus protocol that those who project the most kinetic power in the most clever way earn the right to set the state and chain of custody of limited resources. No one gets the option to unsubscribe from this social consensus protocol, right? Those who project the most kinetic power set the state

and chain of custody. Okay. That is true, not only for animals, right? Like if I threw a juicy steak in between a pack of wolves, who gets the steak? Whoever gets there first, whoever's the strongest. Right. So animals actually establish their own pecking order based off of their capability to project power, right? Humans are no different. We're animals too. There's limited resources. It is an existential necessity for us to establish a pecking order to achieve consensus on the legitimate state and chain of custody of all property. We do it through kinetic power projection. The cool thing about kinetic power projection is it's a permissionless protocol. I don't need the permission of another country or another person if I can project enough power in a clever way, right?

That's how you establish a permissionless control structure over all, as you would say, analog property. But what was really, really fascinating about Bitcoin specifically is that it takes this exact same power projection game, right? But instead of kinetically derived joules, it's electrically derived joules. And that is really, really interesting. It works effectively the same exact way as militaries do. What's the role of the military? The role of the military is to project so much kinetic power that it's too expensive not to cooperate with whoever owns that military, right?

That's the main deal. The role of the military is to countervail the control authority of someone that has been oppressive, right? So the reason why the United States exists is because people in North America started feeling that the monarchy was being oppressive to them. So they exercised their permissionless control structure over property. And here we are. Now we identify as Americans. So that's important to point out. It's not just because you see this all the time on Twitter. People are bashing that like USD, you know, is proof of war. Literally everything is proof of war, Anthony.

Like if you identify as a citizen in a country, that is because people projected a bunch of kinetic power to create that rule of law. Like the state of ownership of everything is as a result of either kinetic proof of fork, or contractual legal proof, which only exists because someone won a war to legitimize that. Okay. So how is Bitcoin different? Bitcoin takes the exact same game, right? That all animals have been playing for 4 billion years, but it transposes that game digitally. So instead of kinetic proof of work, you do electric proof of work. Those who project the most electric power and win the competition earn the right to set the state and chain of custody of the underlying piece

of property, in this case, Satoshi's. And if those entities, which we would call miners, ever become oppressive, right? If they ever just start mining empty blocks and not allowing people to transact over the ledger, then the beautiful thing about Bitcoin is that it restores the ability for all users to countervail the control authority of those oppressors through what? Projection of power. And in Bitcoin denominated terms, it always gets easier to project more power. It's never been cheaper to mine, right? It's cheaper to mine now with an S19 than it is to mine with your USB miners from a

while ago in Bitcoin denominated terms, which means it's always getting easier and easier for users to countervail the control authority of oppressors if they emerge. And so that's interesting because then what effectively is the primary value delivered function of Bitcoin is not to create a piece of digital property. That part to me is boring. The part that is interesting to me is you have restored a permissionless control structure over any a property using the exact same way, like the exact same mechanism as warfare. And you've done so after civilization has effectively stalemated itself with nuclear power. The problem with nuclear weapons is it's too expensive to use them right so we have lost civilization has lost their ability

uh to have permissionless control structure over property right if does that make sense like it makes complete sense yeah it we risk nuclear annihilation correct to to use this um to use this power projection protocol now so that that's bad by the way it's not the first time it happens Happens all the time in nature. So nature, animals will actually grow random power projection mechanisms out of their foreheads so that they can continue to play the game and establish pecking order and to achieve consensus on the legitimate state and chain of custody of resources like territory, right? We call them antlers, right? We call them, you know, look at bugs with their weird horns on the top, right? They evolved a way to continue the power projection again, but do so in a way that won't threaten the species, right? Like we're not going to kill each other anymore. We're just going to awkwardly clash our antlers together. And then that's how we're going to decide who gets to own

what. And so this sounds ridiculous, I know, but I keep telling people Bitcoin are human antlers. We have re-established a way to achieve a permissionless control structure over property, which is needed to defend against oppression, but still maintain fairness, still maintain the ability to achieve consensus on the legitimate state and chain of custody of a property and so that's pretty cool we should probably monetize that right and like people are like well you know there's no way bitcoin would ever um you know end war it's like no i'm not saying it would end war right like obviously kinetic power projection would still be necessary for all forms of physical property that people value, right? Like there's low probability that I'm going to stop valuing

water, that I'm going to stop valuing, you know, land, that I'm going to stop valuing contracts, that I'm going to stop valuing oxygen, but no one says we have to monetize those things. What if the cool thing about money is it can take any shape it wants. It's a shape-shifting thing. And so if you transpose money into a digital commodity and reestablish a power projection permissionless control structure over it, then what you've effectively done, and I know this is wacko, but what you have effectively done is digitally transformed warfare itself from a kinetic power projection game into an electric power projection game. And so insofar as we fight each other to defend against money, we don't need to. And the last thing I'll say before opening it for comments is this. And this is why I drew that picture because we have a picture. we have the picture here that uh that we're gonna show everyone okay so the thing i wrote this in class i was not paying attention to class um the thing that bothers me about like these esg accusations against bitcoin is like they fundamentally misunderstand what the point

of bitcoin is right they fundamentally misunderstand what the point of all that energy or all that power projection is the point of projecting that much power is to make it too expensive to attack the ledger, right? Like to make it too expensive to be uncooperative with the people who use Bitcoin. This is exactly what the military does, right? The power of every single bomb, the power of every single bullet, the power of every single engine behind every single plane or ship or sub or truck or tank, the power of every heartbeat of every service member of every military in the world is measured in watts. And those watts are spent explicitly to protect and defend resources up until Bitcoin to protect and defend monetary resources.

And to say that Bitcoin is a waste of energy is effectively the same as saying your military is a waste of energy. It's a waste of energy to have a standing military to protect our rule of law or whatever we're trying to protect. Like, yeah, it's inefficient to sail a bunch of carrier battle groups through the ocean, right? You know, it's more inefficient, Anthony, than sailing a bunch of carrier battle groups or testing about a bunch of nuclear missiles all the time. Being invaded, being conquered, that's pretty inefficient. And if you want to learn what happens to people who decide not to build a standing military, read history. History is literally just a story of all the countries that decided that it was too inefficient to have a standing military. And so it's like, oh, Bitcoin's bad because it projects too much

power. It's like saying, dollar for dollar, I wish my military projected less power. You don't understand the point of Bitcoin. The point of Bitcoin is to defend the network, to defend every user that volunteers to make that underlying piece of property their form of money. And so when we look at this image that you have drawn here, what's so fascinating to me is that you are taking a lot of these ideas, which I think are one, very nuanced, but two, very kind of deep intellectually, and you literally put it on one piece of paper, right? Which is very hard for a lot of people to do, is to take these complex ideas and explain them simply. But what I think is probably the most important part of this entire thing that you've drawn here

is that there's a dotted line across the middle. And on top of that dotted line, you have an arrow pointing up, and you say that the assets, such as land and real estate, gold, oil, equities, et cetera, are all defended with military and rule of law. And then below the dotted line, you have a arrow down that says Bitcoin is protected and defended with electricity and code. And so is the argument here that ultimately the protection via electricity and code is not only superior from an effectiveness standpoint, but also it is superior from efficiency standpoint as well? Is that a fair way to kind of think about this? Yeah. So like, let's just do a thought experiment. I would love to do a thought experiment with you. Go ahead. How many

bombs would it take to blow up the internet? A lot. I don't know. Maybe you've thought about it. How many? It would probably take a lot of bombs, right? Like to stop Bitcoin, you would have to hunt down every miner forever, right? And maintain that. And so that's like really difficult um to do it is it is and so like the efficiency of mining is awesome you but but still like even efficiency so this is the trap this is a trap that people do with like esg they'll say bitcoin uses too much energy it could be more resourceful or it could be more renewable energy Right. And then you respond with, OK, well, it's getting more renewable and it's not that bad. It's like pretty efficient for the amount of defense. But the problem is the ESG argument is essentially an ethical argument.

Correct. Right. It's not a rational argument. It's an ethical argument. And so that bothers me because if you want to make an ethical argument that Bitcoin is a waste of energy, then you have to do an apples and apples comparison to the resources that are spent to defend legacy property. And the resources that are spent to defend legacy property is human bloodshed, right? Like, that's why the rule of law is the rule of law. That's why we can say we own this land, not another nation, right? The state and chain of custody of all legacy monetary property is written in blood, right? And so you just have to be careful. Like, yes, I agree that Bitcoin is a super efficient way to defend monetary property,

but people aren't really arguing about efficiency. They're making an ethical case. And so if you want to play the ethical game, then let's play that game. Right. But that being said, yeah, it's like way off, like way efficient to use Bitcoin to defend your property. in this case, what you would choose to serve as money, as it would be to use an entire military. But also, it's better to pay an electric bill than it is to pay a blood bill, if that makes sense. Absolutely. I've got one more question. My brother's probably got questions for you. My question is, when you think of this idea of kind of electrical protection, right, whether it's offense defense whatever it is that there's an electrical power that goes into this and that is the uh the network how do you think about that being in the hands of individuals whether they're

in the united states or elsewhere right and kind of this idea of they can use that protection against the oppressive government or uh against any sort of overreaching monetary policy that steals uh purchasing power or anything like that versus it being in the hands of uh corporations financial institutions or even nation states themselves right like to me one of the most interesting aspects of Bitcoin is that it doesn't matter who you are, right? If you go all the way up to Michael Saylor and MicroStrategy holding Bitcoin, he is no different than you holding Bitcoin, me holding Bitcoin, or somebody in India, somewhere in an African country, or somebody on South American country, right? Just everyone is the same in terms of holding that Bitcoin.

But when you start to talk about this as kind of a military wrapped into a monetary asset, I do think that people say, okay, well, what happens when the nation states actually start to buy Bitcoin? We've seen El Salvador now start to do this. So like, do you have any thoughts there in terms of Bitcoin in different people's hands, if that changes your analysis or are we overthinking it in some way? I guess, first of all, it's in everyone's best interest to defend themselves. Okay. So like if you create a pristine self-defense architecture, you can bet that like every type of person or organization, regardless of what their interests are, would benefit from having a pristine self-defense network. What's super interesting

about Bitcoin is it creates a kind of game theory stability point, a showing point that I am calling in my thesis, mutually assured preservation. It's to distinguish it from the shelling point that we get with kinetic proof of work, which is mutually assured destruction. So the way we achieve stability right now through kinetic proof of work is to basically hold a knife to each other's throats and say, don't do anything bad, right? That's how we achieve stability. With Bitcoin, everything that a nation does to increase the hash rate is beneficial to everyone else, assuming they don't 51% attack the network. So you are actually by, quote, projecting more electric power in Bitcoin, you are actually mutually assuring

the preservation of the security of your opponent and so this gets really interesting because like maybe instead of fighting you just let them improve the hash rate let them improve the security so long as it doesn't 51 attack the network or like you know if everyone's using the same currency, then the productivity of your opponent means real world gains for you too. And so that's the beautiful thing about Bitcoin is it creates frenemies. It doesn't matter who you are. If you use Bitcoin, you are benefiting each other mutually. By the way, if you buy a a bunch of Bitcoin first and front run everyone else, then they, their productivity benefits you disproportionately more. So like, it'd probably be a good idea to buy it, to buy a lot of it,

right? Like you see, you know, you see these people talking about like, you know, Bitcoin will be it represents a huge capital flight risk okay how do you fix that buy it before they do and recapture the capital right like there's a whole lot there are very few scenarios where buying bitcoin doesn't solve the strategic threat if that makes sense i i think that this idea of moving from a zero sum to a positive sum world is very important because ultimately what you are doing is you are simply saying that humans are going to continue to be humans. They're going to continue to look after their best self-interest. They're going to look for the ability to protect themselves. And in doing so, as they adopt the protection, that protection, then they are

incentivized to increase its efficiency its effectiveness its strength etc and then by increasing their ability to protect themselves they are inherently protecting you as well is a concept that uh historically has not been afforded to folks and so it takes a while to break down kind of the old mental framework and replace it with this new idea of in a positive of some world human incentives take over and everyone ends up adopting the asset that can protect themselves and as they do that they actually protect everybody else which means that the need for conflict is drastically reduced because ultimately uh as protected as you are so is your enemy and therefore if you have confidence in your own protection system

you therefore should have doubt in your offensive capabilities of violating their protection as well, right? Yeah, so first of all, I wouldn't say that humans will continue to be humans. I would say that animals will continue to be animals. True. Like literally all living creatures as an existential necessity must fight over limited resources. The biggest bloodbath was 4 billion years ago between single cellular organisms, right? This is a social consensus protocol over resources that no one gets to unsubscribe to. Unless your heart doesn't bleed, if it gets hit by a bullet, you tacitly comply to this social consensus protocol. And so that was the first point I made. But there's nothing that says it has to be a kinetic power projection protocol. It could be electric. Cool thing about electric is no one has to bleed, right? And another thing, too, which is super fascinating is with kinetic power projection, you scale, you basically destroy infrastructure, right?

The end of the war is rubble, right? Infrastructure is destroyed as you scale kinetic power projection higher and higher and higher to the point where you get atomic level like horrors. With electric power projection, the end game is more infrastructure, cheaper energy for everybody, right? So, like, the end of a hash war is free energy and abundance for everybody. And you achieve that using literally the same physics. It is the same physics. so why don't we play that game over monetary property that sounds like a good idea correct joe and john what questions do you guys have hey jason thanks for doing this uh my question would just be i want to hear like i was thinking to myself you were saying some wild stories earlier about uh not only the gps and everything like that but my i'm curious about what is the craziest

like thing about space that people have no idea about um i know you got something yeah i mean there's a lot like when you look when you look up into the sky and see stars you're looking down into the universe all right that was pretty good explain yeah when when you look at like a star you're looking at the past like billion like very many years ago when you uh it's it's pretty awesome space is pretty cool but yeah so like you know uh you know look down um when you look into the sky you're mostly just looking down into the Milky Way. And pretty much all you can see is a couple of local stars.

That's it. That's crazy. Yeah, that was even better than I expected. John, what questions you got? Jason, what's up? Thank you for your service. First of all, you represent Space Force. Well, how many people from Space Force have you talked to? You're the first one. I think I want to sign up tomorrow. jason you could take that clip and you could send it to your boss so then you're like look i should do more of these right we're out here recruiting yeah so my question is most people don't think about bitcoin in the manner that you thought about they really just think about price what are your thoughts around the price of bitcoin it hasn't changed it's been as far as i know

a hundred million satoshis that's the best answer i've ever heard and what's cool about what's cool about satoshi's is like what used to cost me a hundred thousand satoshi's to buy now cost me twenty thousand satoshi's to buy it's pretty sweet and when you think about that idea is the end game here that everything gets priced in satoshi's because ultimately all other forms of value don't have the protection of that kind of electrical power production. And therefore, naturally, more and more and more people who have monetary value want to protect it with the most superior form of protection. And therefore, that economic value, they demonetize other assets, and it flows into the most protection that they can find.

there's three functions of money right three big ones store of value medium of exchange unit of account correct right now there's a whole bunch of trauma over what's going to be the next medium of exchange i don't really care that's not really important to me store of value is important to me, but the Holy Grail is unit of account. How do you measure value itself? How do you perceive value itself? If you measure and perceive value in Satoshis, then mathematically speaking, by definition, the value of everything is, well, sorry, the price of everything is decreasing relatively relative to satoshi's and so the like so if you want to essentially you want to own the value token if you own the token which denominates value itself then you

literally own everything right so like like mathematically speaking so for example it's super funny when people are like, well, look at the price of Ethereum. The Bitcoin denominated cost of Ethereum is increasing or decreasing. Take your pick. Okay. First of all, you made that conversion using dollars. So you took the dollar denominated cost of Ethereum and you divided it by the dollar denominated costs of Bitcoin. But the more important point is you just denominated the value of your Ethereum in Bitcoin. You have tacitly acknowledged that Bitcoin is a good unit of account to measure the quote value of your Bitcoin, or sorry, to measure the value of your Ethereum. So what happens when everybody starts thinking that way, when everyone says, if they

want to know what the real value of their thing is, they ask themselves, how many Bitcoin could I convert it to? Your whole perception of everything changes completely. And you enter this world where like you finally actually have a perfect signal on what value is because no one's messing with the purchasing power of your denominator it's really powerful stuff and so the single most important question to ask yourself is a hundred and hundred years into the future you know as we progress into the future what are people most likely going to use as their unit of account? Are they going to use the thing whose purchasing power is constantly changing? Or are they going to use the thing that stays fixed? Or are they going to use the thing that

stays fixed and has the most powerful defense infrastructure around it? I'll give you a spoiler. It's already Bitcoin. People are already comparing the value of their crypto insofar as the number of Bitcoin it converts to. They use dollars to make that conversion, but eventually that might not be true. And so if you want to front run everybody, buy Bitcoin. So I have two questions to finish up with. The first one is a little bit more fun, which is, I saw somebody ask, what do they call members of the Space Force? The army, their soldiers, etc. What are members of the Space Force called? We're called Guardians. Guardians. Okay. Yeah. There was a bunch of like different names. It could have been Sentinel. It could have been a couple other things. And we

kind of voted on, they actually asked us to vote on what we want to be called. And so right now we're called Guardians. I feel like that is very fitting for you. The second question that I have is your background. You have, I think, screensavers up. You've got a computing device in the corner explain a little bit as to what's going on here because this also is very fitting for this conversation um it's a computer so in the uh so i used to be the director of operations for the second space launch squadron out at vandenberg space force base which is the base that launches all of our satellites into polar orbits okay and what's cool about being on like the ops floor of a launch control room is you have these huge screens and the reason why

is because you need to see as much data as possible without having to like to lower a tab to like minimize a tab on your on your screen and so after spending many hours in control rooms with the luxury of never having to to ever minimize a tab i was like well okay why don't i apply that to my, uh, home, uh, command and control station. And so I just found a bunch of cheapo monitors and, uh, put them together. And now I can't remember the last time I've lowered a tab. Amazing. Um, my last comment is, uh, there are three times in the five or six years that I've been doing this now where I've had a conversation with somebody. And when we end the conversation, i say to myself i am going to immediately go buy more bitcoin the first time was when i talked to

a gentleman named marad mahabdiv uh he essentially laid out an argument for the legacy financial assets being demonetized uh over time flowing that economic value into bitcoin uh and doing some simple back of the napkin math said you know 10 million dollar bitcoin price in us dollar terms Not necessarily because you think you're a trader, but more so understanding kind of macro capital flows, monetization of assets, demonetization, trust in those assets, etc. So very similar to the conversation we're having now. Second one was when Michael Saylor and I spoke when he, for the first time, talked about putting Bitcoin on his balance sheet. And he explained to me the logic that he had, both from an understanding of Bitcoin, but also from an economic standpoint of protecting his balance sheet. And this idea of, in your words, kind of using that electrical power production to protect his balance sheet.

And the third time's today, because I don't think I've ever heard somebody describe Bitcoin as having kind of this wrapped value of both the money with a stand-in army that is neither offensive or defensive, but has the ability to use that electrical power production. And when you think of it in terms of the electrical power production being the single greatest kind of protection that you can provide to a monetary asset, I think it becomes pretty clear that other assets over time. And again, you know, what that timeframe is, is up for debate. People will lose trust and frankly lose appetite either from an ethical standpoint or kind of a rational standpoint in wanting bloodshed to protect that monetary premium or those monetary assets. And so if I'm given the choice between send, you know, young men and women to war or use electrical power production to protect my assets, I think most people over time decide, well, that electrical thing sounds pretty damn good, right? Sounds like that's more humane. Sounds like it's more effective. It's more

efficient. And I think more importantly, it shows a path to a positive some world where when you begin to understand the importance of that and the impact of that, then ultimately, I think it falls back to this comment that I always make, which is the rise and adoption of Bitcoin, in my personal opinion will do more good for the world than all philanthropy combined. And when you measure it in terms of economic impact, maybe that's true, maybe that's not. But when you measure it in terms of the avoidance of conflict or the protection of purchasing power and the ability to close wealth inequality gaps from a first principle standpoint, et cetera, it's just very, very compelling. So I appreciate you taking the time to come in and talk about this. I'm going

to do my absolute best to wrangle you into coming back as many times as you will let me wrangle you into doing this because i think people can learn a lot from you uh but i'll ask john and joe if you guys had any uh last comments before uh we let jason go jason i got one additional question for you what is a must-read book from you what's your favorite book i used to tell people uh i used to give people recommendations about to live but i don't do that anymore that's the best answer you've had all day so um probably sapiens it's a great one awesome man where can we send people uh i've dropped your uh twitter account into the chat uh do you want us to send people to linkedin anywhere else that uh we should send folks to uh to find you on the

internet? Yeah, just my LinkedIn and my Twitter. I use both of those to essentially test ideas for the research I'm doing and to be fully transparent about everything that I'm doing. Some of my takes are garbage and I appreciate the feedback that I get, particularly from Twitter when those takes are garbage. But I can't express enough how thankful I am for just the fantastic arguments the fantastic support that i get from everyone i really appreciate it and also pop that was really nice of what you said earlier so thank you i i meant every word of it uh there's very few people after having done this for so long that i uh know from the first time the first time you and i are talking uh verbally um that i just know one you're going to be a star two uh it would be

in the best interest of every single person that is already protecting their monetary assets with that electrical power production to make sure that we fill your calendar with as many podcasts, television appearances, blog posts, tweets, et cetera, as possible. Cause I think you have a message that a lot of people can benefit from. So I appreciate you coming on here and talking about it. And, uh, I'm going to go look at my calendar after I buy some Bitcoin and figure out when I can bring you back. Well, thanks Joe. Thanks John. Thanks Bob. Appreciate it. Awesome. Thank you so much. Take care. Later.